What Shall We Do? : Chapter 18

1904

People

(1828 - 1910) ~ Father of Christian Anarchism : In 1861, during the second of his European tours, Tolstoy met with Proudhon, with whom he exchanged ideas. Inspired by the encounter, Tolstoy returned to Yasnaya Polyana to found thirteen schools that were the first attempt to implement a practical model of libertarian education. (From : Anarchy Archives.) • "If, in former times, Governments were necessary to defend their people from other people's attacks, now, on the contrary, Governments artificially disturb the peace that exists between the nations, and provoke enmity among them." (From : "Patriotism and Government," by Leo Tolstoy, May 1....) • "People who take part in Government, or work under its direction, may deceive themselves or their sympathizers by making a show of struggling; but those against whom they struggle (the Government) know quite well, by the strength of the resistance experienced, that these people are not really pulling, but are only pretending to." (From : "A Letter to Russian Liberals," by Leo Tolstoy, Au....) • "It usually happens that when an idea which has been useful and even necessary in the past becomes superfluous, that idea, after a more or less prolonged struggle, yields its place to a new idea which was till then an ideal, but which thus becomes a present idea." (From : "Patriotism and Government," by Leo Tolstoy, May 1....)

CHAPTER XVIII

What is the origin of money? What are the conditions
under which nations always have money, and under what
circumstances need nations not use money?

There are small tribes in Africa, and one in Australia,
who live as the Sknepies and the Drevlyans lived in olden
times. These tribes lived by breeding cattle and cultivating
gardens. We become acquainted with them at the
dawn of history, and history begins by recording the
fact that some invaders appear on the scene. And
invaders always do the same thing: they take away from
the aborigines everything they can take,—cattle, corn,
and cloth; they even make prisoners, male and female,
and carry them away.

In a few years the invaders appear again, but the
people have not yet got over the consequences of their
first misfortunes, and there is scarcely anything to take
from them; so the invaders invent new and better means
of making use of their victims.

These methods are very simple, and present themselves
naturally to the mind of all men. The first is personal
slavery. There is a drawback to this, because the invaders
must take over the entire control and administration
of the tribe, and feed all the slaves; hence, naturally,
there appears the second. The people are left on
their own land, but this becomes the recognized property
of the invaders, who portion it out among the leading
military men, by whose means the labor of the tribe is
utilized and transferred to the conquerors.

But this, too, has its drawback. It is inconvenient to
have to oversee all the production of the conquered
people, and thus the third means is introduced, as primitive
as the two former; this is, the levying of a certain
obligatory tax to be paid by the conquered at stated
periods.

The object of conquest is to take from the conquered
the greatest possible amount of the product of their labor.
It is evident, that, in order to do this, the conquerors
must take the articles which are the most valuable to
the conquered, and which at the same time are not cumbersome,
and are convenient for keeping,—skins of
animals, and gold.

So the conquerors lay upon the family or the tribe
a tax in these skins or gold, to be paid at fixed times; and
thus, by means of this tribute, they utilize the labor of
the conquered people in the most convenient way.

When the skins and the gold have been taken from the
original owners, they are compelled to sell all they have
among themselves to obtain more gold and skins for
their masters; that is, they have to sell their property
and their labor.

So it was in ancient times, in the Middle Ages, and so
it occurs now. In the ancient world, where the subjugation
of one people by another was frequent, personal
slavery was the most widespread method of subjugation,
and the center of gravity in this compulsion, owing to
the non-recognition of the equality of men. In the Middle
Ages, feudalism—land-ownership and the servitude connected
with it—partly takes the place of personal slavery,
and the center of compulsion is transferred from persons
to land. In modern times, since the discovery of
America, the development of commerce, and the influx
of gold (which is accepted as a universal medium of exchange),
the money tribute has become, with the increase
of state power, the chief instrument for enslaving men,
and upon this all economic relations are now based.

In “The Literary Miscellany” there is an article by
Professor Yanjoul in which he describes the recent history
of the Fiji Islands. If I were trying to find the most
pointed illustration of how in our day the compulsory
money payment became the chief instrument in enslaving
some men by others, I could not imagine anything more
striking and convincing than this trustworthy history,—history
based upon documents of facts which are of recent
occurrence.

In the South-Sea Islands, in Polynesia, lives a race
called the Fiji. The group on which they live, says Professor
Yanjoul, is composed of small islands, which altogether
comprise about forty thousand square miles.
Only half of these islands are inhabited, by a hundred
and fifty thousand natives and fifteen hundred white men.
The natives were reclaimed from savagery a long time
ago, and were distinguished among the other natives of
Polynesia by their intellectual capacities. They appear
to be capable of labor and development, which they
proved by the fact that within a short period they became
good workmen and cattle breeders.

The inhabitants were well-to-do, but in the year 1859
the condition of their state became desperate: the nation
and its representative, Kakabo, were in need of money.
This money, forty-five thousand dollars, was wanted as
compensation or indemnification demanded of them by
the United States of America for violence said to have
been done by Fijis to some citizens of the American
Republic.

To collect this, the Americans sent a squadron, which
unexpectedly seized some of the best islands under the
pretext of guaranty, and threatened to bombard and ruin
the towns if the indemnification were not paid over on
a certain date to the representatives of America.

The Americans were among the first colonists who came
to the Fiji Islands with the missionaries. They chose
and (under one pretext or another) took possession of the
best pieces of land on the islands, and established there
cotton and coffee plantations. They hired whole crowds
of natives, binding them by contracts unknown to this
half-civilized race, or they acted through special contractors
and dealers of human merchandise.

Misunderstandings between these master planters and
the natives, whom they considered almost as slaves, were
unavoidable, and it was some of these quarrels which
served as a pretext for the American indemnification.

Notwithstanding their prosperity the Fijis had preserved
almost up to that time the forms of the so-called natural
economy which existed in Europe during the Middle
Ages: money was scarcely in circulation among them,
and their trade was almost exclusively on the barter
basis,—one merchandise being exchanged for another,
and the few social taxes and those of the state being paid
in rural products. What could the Fijis and their King
Kakabo do, when the Americans demanded forty-five
thousand dollars under terrible threats in the event of
nonpayment? To the Fijis the very figures seemed inconceivable,
to say nothing of the money itself, which
they had never seen in such large quantities. After deliberating
with other chiefs, Kakabo made up his mind
to apply to the Queen of England, at first merely asking
her to take the islands under her protection, but afterwards
requesting definite annexation.

But the English regarded this request cautiously, and
were in no hurry to assist the half-savage monarch out
of his difficulty. Instead of giving a direct answer, they
sent special commissioners to make inquiries about the
Fiji Islands in 1860, in order to be able to decide whether
it was worth while to annex them to the British Possessions,
and to lay out money to satisfy the American
claims.

Meanwhile the American Government continued to
insist upon payment, and as a pledge held in their de
facto dominion some of the best parts, and, having looked
closely into the national wealth, raised their former claim
to ninety thousand dollars, threatening to increase it still
more if Kakabo did not pay at once.

Being thus pushed on every side, and knowing nothing
of European means of credit accommodation, the poor
king, acting on the advice of European colonists, began
to try to raise money in Melbourne among the merchants,
cost what it might, if even he should be obliged to yield
his kingdom into private hands.

So in consequence of his application a commercial
society was formed in Melbourne. This joint-stock company,
which took the name of the “Polynesian Company,”
formed a treaty with the chiefs of the Fiji-Islanders
on the most advantageous terms. It took over
the debt to the American Government, pledging itself to
pay it by several installments; and for this the company
received, according to the first treaty, one, and then two
hundred thousand acres of the best land, selected by
itself; perpetual immunity from all taxes and dues for
all its factories, operations, and colonies, and the exclusive
right for a long period to establish banks in the Fiji
Islands, with the privilege of issuing unlimited notes.

This treaty was definitely concluded in the year 1868,
and there has appeared in the Fiji Islands, side by side
with the local government, of which Kakabo is the head,
another powerful authority,—a commercial organization,
with large estates over all the islands, exercising a powerful
influence upon the government.

Up to this time the wants of the government of Kakabo
had been satisfied with a payment in local products, and
a small custom tax on goods imported. But with the conclusion
of the treaty and the formation of the influential
“Polynesian Company,” the king's financial circumstances
had changed.

A considerable part of the best land in his dominion
having passed into the hands of the company, his income
from the land had therefore diminished; on the other
hand the income from the custom taxes also diminished,
because the company had obtained for itself the right to
import and export all kinds of goods free of duties.

The natives—ninety-nine per cent. of the population—had
never paid much in custom duties, as they bought
scarcely any of the European productions except some
stuffs and hardware; and now, from the freeing of custom
duties of many well-to-do Europeans along with the Polynesian
Company, the income of King Kakabo was reduced
to nil, and he was obliged to take steps to resuscitate it
if possible.

He began to consult his white friends as to the best
way to remedy the trouble, and they advised him to
create the first direct tax in the country; and, in order,
I suppose, to have less trouble about it, to make it in
money. The tax was established in the form of a general
poll-tax, amounting to one pound for every man, and to
four shillings for every woman, throughout the islands.

As I have already said, there still exists on the Fiji
Islands a natural economy and a trade by barter. Very
few natives possess money. Their wealth consists chiefly
of raw products and cattle; whilst the new tax required
the possession of considerable sums of money at fixed
times.

Up to that date a native had not been accustomed to
any individual burden in the interests of his government,
except personal obligations; all the taxes which had to be
paid, were paid by the community or village to which he
belonged, and from the common fields from which he
received his principal income.

One alternative was left to him,—to try to raise money
from the European colonists; that is, to address himself
either to the merchant or to the planter.

To the first he was obliged to sell his productions on
the merchant's own terms (because the tax-collector required
money at a certain fixed date), or even to raise
money by the sale of his expected harvest, which enabled
the merchant to take iniquitous interest. Or he had to
address himself to the planter, and sell him his labor;
that is, to become his workman: but the wages on the
Fiji Islands were very low (owing, I suppose, to the exceptionally
great supply of labor); not exceeding a
shilling a week for a grown-up man, or two pounds twelve
shillings a year; and therefore, merely to be able to get
the money necessary to pay his own tax, to say nothing
of his family, a Fiji had to leave his house, his family,
and his own land, often to go far away to another island,
and enthralled himself to the planter for at least half a year;
even then there was the payment for his family, which
he must provide by some other means.

We can understand the result of such a state of affairs.
From his hundred and fifty thousand subjects, Kakabo
collected only six thousand pounds; and so there began
a forcible extortion of taxes, unknown till then, and a
whole series of coercive measures.

The local administration, formerly incorruptible, soon
made common cause with the European planters, who
began to have their own way with the country. For nonpayment
of the taxes the Fijis were summoned to the
court, and sentenced not only to pay the expenses but
also to imprisonment for not less than six months. The
prison really meant the plantations of the first white man
who chose to pay the tax-money and the legal expenses
of the offender. Thus the white settlers received cheap
labor to any amount.

At first this compulsory labor was fixed for not longer
than half a year; but afterwards the bribed judges found
it possible to pass sentence for eighteen months, and even
then to renew the sentence.

Very quickly, in the course of a few years, the picture
of the social condition of the inhabitants of Fiji was quite
changed.

Whole districts, formerly flourishing, lost half of their
population, and were greatly impoverished. All the male
population, except the old and infirm, worked far away
from their homes for European planters, to get money
necessary for the taxes, or in consequence of the law
court. The women on the Fiji Islands had scarcely ever
worked in the fields, so that in the absence of the men,
all the local farming was neglected and went to ruin.
And in the course of a few years, half the population of
Fiji had become the slaves of the colonists.

To relieve their position the Fiji-Islanders again appealed
to England. A new petition was got up, subscribed
by many eminent persons and chiefs, praying to
be annexed to England; and this was handed to the
British consul. Meanwhile, England, thanks to her scientific
expeditions, had time not only to investigate the
affairs of the islands, but even to survey them, and duly
to appreciate the natural riches of this fine corner of the
globe.

Owing to all these circumstances, the negotiations this
time were crowned with full success; and in 1874, to the
great dissatisfaction of the American planters, England
officially took possession of the Fiji Islands, and added
them to its colonies. Kakabo died, his heirs had a small
pension assigned to them, and the administration of the
islands was entrusted to Sir Hercules Robinson, the
Governor of New South Wales. In the first year of its
annexation the Fiji-Islanders had no self-government, but
were under the direction of Sir Hercules Robinson, who
appointed an administrator.

Taking the islands into their hands, the English Government
had to undertake the difficult task of gratifying
various expectations raised by them. The natives, of
course, first of all expected the abolition of the hated poll-tax;
one part of the white colonists (the Americans)
looked with suspicion upon the British rule; and another
part (those of English origin) expected all kinds of confirmations
of their power over the natives,—permission
to enclose the land, and so on. The English Government,
however, proved itself equal to the task; and its
first act was to abolish for ever the poll-tax, which had
created the slavery of the natives in the interest of a few
colonists.

But here Sir Hercules Robinson had at once to face a
difficult dilemma. It was necessary to abolish the poll-tax,
which had made the Fijis seek the help of the English
Government; but, at the same time, according to English
colonial policy, the colonies had to support themselves;
they had to find their own means for covering the expenses
of the government. With the abolition of the poll-tax,
all the incomes of the Fijis (from custom duties) did
not amount to more than six thousand pounds, while the
government expenses required at least seventy thousand
a year.

Having abolished the money tax, Sir Hercules Robinson
now thought of a labor tax; but this did not yield
the sum necessary to feed him and his assistants. Matters
did not mend until a new governor had been appointed,—Gordon,—who,
to get out of the inhabitants the money
necessary to keep him and his officials, resolved not to
demand money until it had come sufficiently into general
circulation on the islands, but to take from the natives
their products, and to sell them himself.

This tragical episode in the lives of the Fijis is the
clearest and best proof of the nature and true meaning
of money in our time.

In this illustration every essential is represented. The
first fundamental condition of slavery,—the guns, threats,
murders, and plunder,—and lastly, money, the means of
subjugation which has supplanted all the others. That
which in an historical sketch of economical development,
has to be investigated during centuries, we have
here, where all the forms of monetary violence have fully
developed themselves, concentrated in a space of ten
years.

The drama begins thus: the American Government
sends ships with loaded guns to the shores of the islands,
whose inhabitants they want to enthralled. The pretext
of this threat is monetary; but the beginning of the
tragedy is the leveling of guns against all the inhabitants,—women,
children, old people, and men,—though innocent
of any crime. “Your money or your life,”—forty-five
thousand dollars, then ninety thousand or slaughter.
But the ninety thousand are not to be had. So now
begins the second act: it is the postponement of a
measure which would be bloody, terrible, and concentrated
in a short period; and the substitution of a suffering
less perceptible, which can be laid upon all, and
will last longer. And the natives, with their representative,
seek to substitute for the massacre a slavery of
money. They borrow money, and the method at once
begins to operate like a disciplined army. In five years
the thing is done,—the men have not only lost their right
to utilize their own land and their property, but also their
liberty,—they have become slaves.

Here begins act three. The situation is too painful,
and the unfortunate ones are told they may change their
master and become the slaves of another. Of freedom
from the slavery brought about by the means of money
there is not one thought. And the people call for another
master, to whom they give themselves up, asking him to
improve their condition. The English come, see that
dominion over these islanders will give them the possibility
of feeding their already too greatly multiplied parasites,
and take possession of the islands and their inhabitants.

But it does not take them in the form of personal
slaves, it does not take even the land, nor distribute it
among its assistants. These old ways are not necessary
now: only one thing is necessary,—taxes which must be
large enough on the one hand to prevent the workingmen
from freeing themselves from virtual slavery, and on
the other hand, to feed luxuriously a great number of
parasites. The inhabitants must pay seventy thousand
pounds sterling annually,—that is the fundamental condition
upon which England consents to free the Fijis
from the American despotism, and this is just what was
wanting for the final enslaving of the inhabitants. But
it turns out that the Fiji-Islanders cannot under any
circumstances pay these seventy thousand pounds in
their present state. The claim is too great.

The English temporarily modify it, and take a part of
it out in natural products in order that in time, when
money has come into circulation, they may receive the
full sum. They do not behave like the former company,
whose conduct we may liken to the first coming of savage
invaders into an uncivilized land, when they want only
to take as much as possible and then decamp; but
England behaves like a more clear-sighted enslaver; she
does not kill at one blow the goose with the golden eggs,
but feeds her in order that she may continue to lay them.
England at first relaxes the reins for her own interest
that she may hold them tight forever afterwards, and so
has brought the Fiji-Islanders into that state of permanent
monetary thralldom in which all civilized European
people now exist, and from which their chance of escape
is not apparent.

This phenomenon repeats itself in America, in China, in
Central Asia; and it is the same in the history of the
conquest of all nations.

Money is an inoffensive means of exchange when it is
not collected while loaded guns are directed from the sea-shore
against the defenseless inhabitants. As soon as it
is taken by the force of guns, the same thing must inevitably
take place which occurred on the Fiji Islands, and
has always and everywhere repeated itself.

Men who consider it their lawful right to utilize the
labor of others, will achieve their ends by the means
of a forcible demand of a sum of money which will compel
the oppressed to become the slaves of the oppressors.

Moreover, that will happen which occurred between
the English and the Fijis,—the extortioners will
always, in their demand for money, rather exceed the
limit to which the amount of the sum required must rise,
so that the enslaving may be earlier. They will
respect this limit only while they have moral sense
and sufficient money for themselves: they will overstep
it when they lose their moral sense or even do not require
funds.

As for governments, they will always exceed this limit,—first,
because for a government there exists no moral
sense of justice; and secondly, because, as everyone
knows, every government is always in the greatest want
of money, through wars and the necessity of giving
gratuities to their allies. All governments are insolvent,
and involuntarily follow a maxim expressed by a Russian
statesman of the eighteenth century,—that the peasant
must be sheared of his wool lest it grow too long. All
governments are hopelessly in debt, and this debt on an
average (not taking in consideration its occasional diminution
in England and America) is growing at a terrible
rate. So also grow the budgets; that is, the necessity
of struggling with other extortioners, and of giving presents
to those who assist in extortion, and because of
that grows the land rent.

Wages do not increase, not because of the law of rent,
but because taxes, collected with violence, exist, with
the object of taking away from men their superfluities,
so that they may be compelled to sell their labor to
satisfy them,—utilizing their labor being the aim of
raising the taxes.

And their labor can only be utilized when, on a
general average, the taxes required are more than the
laborers are able to give without depriving themselves
of all means of subsistence. The increase of wages would
put an end to the possibility of slavery; and therefore,
as long as violence exists, wages can never be increased.
The simple and plain mode of action of some men towards
others, political economists term the iron law; the instrument
by which such action is performed, they call a
medium of exchange; and money is this inoffensive
medium of exchange necessary for men in their transactions
with each other.

Why is it, then, that, whenever there is no violent demand
for money taxes, money in its true signification has
never existed, and never can exist; but, as among the
Fiji-Islanders, the Phœnicians, the Kirghis, and generally
among men who do not pay taxes, such as the
Africans, there is either a direct exchange of produce,
sheep, hides, skins, or accidental standards of value, such
as shells?

A definite kind of money, whatever it may be, always
becomes not a means of exchange, but a means of ransoming
from violence; and it begins to circulate among men
only when a definite standard is compulsorily required
from all.

It is only then that everybody wants it equally, and
only then does it receive any value.

And further, it is not the thing that is most convenient
for exchange that receives exchange value, but that which
is required by the government. If gold is demanded, gold
becomes valuable: if knuckle-bones were demanded, they,
too, would become valuable. If it were not so, why,
then, has the issue of this means of exchange always been
the prerogative of the government? The Fiji-Islanders,
for instance, have arranged among themselves their own
means of exchange; well, then, let them be free to exchange
what and how they like, and you, men possessing
power, or the means of violence, do not interfere with
this exchange. But instead of this you coin money, and
do not allow anyone else to coin it; or, as is the case
with us, you merely print some notes, engraving upon
them the heads of the czars, sign them with a particular
signature, and threaten to punish every falsification of
them. Then you distribute this money to your assistants,
and, under the name of duties and taxes, you
require everybody to give you such money or such notes
with such signatures, and so many of them, that a workman
must give away all his labor in order to get these
notes or coins; and then you want to convince us that
this money is necessary for us as a means of exchange!

Here are all men free, and none oppresses the others
or keeps them in slavery; but money appears in society
and immediately an iron law exists, in consequence of
which rent increases and wages diminish to the minimum.

That half (nay, more than half) of the Russian peasants,
in order to pay direct and indirect taxes, voluntarily sell
themselves as slaves to the land-owners or to manufacturers,
does not at all signify (which is obvious); for the
violent collection of the poll-taxes and indirect and land
taxes, which have to be paid in money to the government
and to its assistants (the landowners), compels the workman
to be a slave to those who own money; but it means
that this money, as a means of exchange, and an iron
law, exist.

Before the serfs were free, I could compel Iván to do
any work; and if he refused to do it, I could send him
to the police-sergeant, and the latter would give him the
rod till he submitted. But if I compelled Iván to overwork
himself, and did not give him either land or food,
the matter would go up to the authorities, and I should
have to answer for it.

But now that men are free, I can compel Iván and
Peter and Sidor to do every kind of work; and if they
refuse I give them no money to pay taxes, and then they
will be flogged till they submit: besides this, I may also
make a German, a Frenchman, a Chinaman, and an
Indian, work for me by that means, so that, if they do
not submit, I shall not give them money to hire land,
or to buy bread, because they have neither land nor
bread. And if I make them overwork themselves, or
kill them with excess of labor, nobody will say a word
to me about it; and, moreover, if I have read books on
political economy I shall be quite sure that all men are
free and that money does not create slavery!

Our peasants have long known that with a ruble one
can hurt more than with a stick. It is only political
economists who cannot see it.

To say that money does not create bondage, is the same
as to have asserted, fifty years ago, that serfdom did not
create slavery. Political economists say that money is
an inoffensive medium of exchange, notwithstanding the
fact that its possession enables one man to enthralled
another. Why, then, was it not said half a century ago
that servitude was, in itself, an inoffensive medium of
reciprocal services, notwithstanding the fact that no man
could lawfully enthralled another? Some give their manual
labor, and the work of others consists in taking care of
the physical and intellectual welfare of the slaves, and
in superintending their efforts.